Transaction Cost-based Study On The Influencing Factors Of Rural Household And Agriculture Machinery Investments

From the view of historical development trend, enhancing the level of agricultural mechanization has always been one of the core motivations to promoting the progress of agricultural productivity. At present, peasant households’investment in agricultural machinery accounts for over90%of total investment in agricultural machinery in China, which is the absolute main body of investment in agricultural machinery. Therefore, to further encourage peasant households to invest in agricultural machinery is an important means of improving the development of agricultural productivity in China.Because of high decentralization of cultivated land in China, small arable land per capita in rural areas, problems left over in the reform of land property rights and other reasons, most peasant households invest in agricultural machinery just for their own use, the returns of which can hardly make up for its acquisition cost. Therefore, peasant households purchasing agricultural machinery will definitely release their agricultural machinery into the agricultural machinery operation service market to seek higher returns, while peasant households’investment level in agricultural machinery is directly related to the amount of its returns.In view of less attention and discussion on transaction cost in agricultural machinery operation service market in relevant research, this paper takes it as the starting point and conducts empirical research on the relationship between information acquisition cost, negotiation cost, supervision cost and other factors influencing the transaction cost of agricultural machinery operation service and peasant households’ investment in agricultural machinery, in the hope of providing feasible policies and suggestions on further improving peasant households’investment level in agricultural machinery and promoting the progress of agricultural productivity in China.At present, the influencing factors of farmers’ investment on agricultural machinery proposed by scholars from home and abroad are mainly focus on governmental purchase subsidies of agricultural machinery and the number of farmers’ ownership of resources elements, while considering little about the influence of the transaction cost of the agricultural mechanical operational service and for farmers’ investment on agricultural machinery. As previously mentioned, farmers in our country are still at a stage of dispersive management on small scale. If the purchased agricultural machinery is only for private use, profits which are higher than investment cost can hardly be achieved under most circumstances. Only the agricultural machinery is put in operational service market can it recover the cost as soon as possible and obtain pleasing returns. Thus, the transaction cost of the agricultural mechanical operational service market will have influences on farmers’investment on agricultural machinery through the influence of farmers’investment profit for providing agricultural operational services. It is of certain academic significance to conduct discussion and empirical study while enriching relevant research findings of farmers’investment on agricultural machinery.In addition, the various factors of specific influence on the transaction cost of the agricultural mechanical operational service, which are proved in the process of empirical study in this paper, can provide some thoughts for government to formulate relevant stimulating policies of agricultural machinery investment in practice.This paper, through the method of statistical analysis and the combination of qualitative and quantitative methods, applies the technical route from theories to empirical study and then to policy suggestion and carries out research in accordance with the following train of thought:at first, the paper sorts out pertinent literature in classification of farmers’investment, farmers’investment on agricultural machinery and transaction cost; and then reviews the theories of the economic nature of agricultural mechanization, transaction cost, farmers’investment and inductive agricultural technical innovation. On that basis, the paper obtains a theoretical assumption:the transaction cost of the agricultural mechanical operational service may have an influence on farmers’investment of agricultural machinery, and then forms a quantitative relation between the influencing factors of the transaction cost of the agricultural mechanical operational service and the t volume of farmers’investment on agricultural machinery through empirical analysis of the above theories. At last, on the basis of empirical conclusion, the paper forms countermeasures conducive to the promotion of farmers’ investment on agricultural machinery in our country.The main conclusions of this study are:(1) As the country hardening road mileage increases, the farmers would be significantly stimulated to invest in the agricultural machinery. As the country hardening road mileage increases, transfer costs of the agricultural machinery will be significantly reduced, implementation costs of agricultural machinery services will be less, transaction costs become lower, and the household with the agricultural machinery can make a profit, thereby the famer will increase the investment in agriculture machinery. As you can see, as an important infrastructure for the local rural economic development, the country road plays an important role on reducing transaction costs of farmers’machinery operating, and farmers are stimulated greatly to invest in the agricultural machinery as the country hardening road mileage increases.(2) As communications equipment popularity increases, farmers will invest more in agricultural machinery. As the amount of communications equipments in each household increases, farmers will significantly increase the household investment in agricultural machinery. When farmers are providing the agricultural machinery services, communication equipment is an important tool to improve the communicate efficiency between farmers and service providers, the cost of communication parties is reduced by a more traditional way of communication, households with agricultural machinery will spend less costs for searching the demand, thereby the transaction costs of agricultural operations services decrease, which shows a convenient communication tool can provide more market information channels for famers and stimulate the farmers’ willingness to invest in agricultural machinery. Thus, as the amount of communications equipments increase, the investment of farmers on agricultural machinery will be promoted.(3)As the land plots of each peasant household decrease, famers will be stimulated to invest in agricultural machinery. As the land plots of each household decrease, the negotiation cost of both parties of agricultural machinery services can be significantly reduced, transfer costs of the agricultural machinery will be lower, the transaction costs go down, and the investment of peasant household in agriculture machinery will increase. The peasant households which have many land plots need to pay more negotiation costs, and the households which have agricultural machinery have to pay more machinery transfer costs, which increase the transaction costs of the agricultural machinery operating. The less are the land lots of each household, the more is the investment of the household in agriculture machinery. Thus less land plots of each household will promote farmers to invest in agricultural machinery.For the above conclusion, the paper puts forward relevant policy recommendations:(1) Strengthen the construction of rural hardening roads, improve the infrastructure in rural communities.(2) Plan scientifically, distribute rationally, strengthen the construction of rural communications market.(3) Strengthen the governance for the land fragmentation, and establish the effective transfer market of agricultural land.(4) Encourage the development of agricultural machinery cooperatives, systematise the agricultural machinery services.